Standard Motor Products, Inc. Announces Second Quarter 1999 Earnings
14 July 1999
Standard Motor Products, Inc. Announces Second Quarter 1999 Earnings
NEW YORK, July 14 -- Standard Motor Products, Inc.
, automotive replacement parts manufacturer and distributor
reported its financial results for the second quarter of 1999, the three
months ended June 30, 1999.
Sales for the second quarter of 1999 were $205.7 million, 1.5% lower than
sales of $208.8 million during the comparable quarter of a year ago. Net
earnings for the second quarter of 1999 were $12.0 million or 92 cents per
share, an increase of 39.3% compared to the $8.6 million or 66 cents per share
earned in the second quarter of 1998.
Sales for six months in 1999 were $382.5 million, 14.2% higher than sales
of $334.8 million in the comparable period in 1998. Excluding the $47 million
in sales from acquisitions that were not present a year ago, sales during the
first half of 1999 were essentially flat, compared with a year ago. Net
earnings for the six months in 1999 were $15.7 million or $1.20 per share, an
increase of 38.9% compared to the $113 million or 86 cents per share a year
ago.
Mr. Lawrence Sills, President, said, "Temperature control sales remained
quite strong with sales for the first half showing double-digit growth
excluding the impact of acquisitions. During the second quarter, despite the
fact we had a substantial first quarter pre-season stocking program,
temperature control sales were above last year's record pace. We continue to
carry a strong order bank into the third quarter."
Mr. Sills added, "Sales of engine management products continue to be below
1998 levels, primarily reflecting the late 1998 sale of the fuel pump business
and the effect on our orders from a major customer, who is consolidating
inventories purchased through acquisitions. We believe this is a temporary
impact, as our typical warehouse distributor customer is showing sales
increases."
Mr. Sills added, "The strong growth in net earnings for the second
quarter, up 39.3%, continuing the first quarter performance, reflected our
effective acquisition program, an improvement in gross margin and continued
leverage gained through our overhead expense controls, partially off-set by a
higher tax rate. Gross margin for the second quarter of 1999 was 31.6% up
1.4 points from a year ago, reflecting improvements primarily in our
temperature control business. Selling, general and administrative expense in
the second quarter of 1999 was 20.9% of sales, down 2.2 points from a year
ago, reflecting continued savings in sales and marketing expenses and strict
controls on administrative expenses. The tax rate more than doubled during
the quarter, compared to a year ago, as higher earnings from our domestic
temperature control business reduced the favorable impact of our Hong Kong and
Puerto Rico operations, which carry lower tax rates."
On the balance sheet, Mr. Sills commented, "Our receivables have increased
due to the seasonality of our temperature control business and are on plan.
Although inventories have been reduced by more than $6 million since the end
of the first quarter of this year, we are committed to make further
significant reductions during the remainder of 1999."
STANDARD MOTOR PRODUCTS, INC.
Consolidated Statements of Income
(Dollars in thousands, except per share amounts)
THREE MONTHS ENDED JUNE 30, SIX MONTHS ENDED JUNE 30,
1999 1998 1999 1998
NET SALES $205,714 $208,766 $382,503 $334,811
COST OF SALES 140,625 145,694 264,194 227,949
GROSS PROFIT 65,089 63,072 118,309 106,862
SELLING, GENERAL &
ADMINISTRATIVE EXPENSES42,929 48,175 87,361 95,680
OPERATING INCOME 22,160 14,897 30,948 21,182
OTHER INCOME (EXPENSE)
-- NET (516) 115 (829) 347
INTEREST EXPENSE 4,802 5,105 8,243 8,480
NET EARNINGS BEFORE
TAXES AND
MINORITY INTEREST 16,842 9,907 21,876 13,049
TAXES BASED ON EARNINGS 4,768 1,251 6,016 1,622
MINORITY INTEREST (41) (17) (179) (135)
NET EARNINGS $12,033 $8,639 $15,681 $11,292
NET EARNINGS
PER COMMON SHARE:
BASIC $0.92 $0.66 $1.20 $0.86
DILUTED $0.91 $0.65 $1.19 $0.86
Weighted Average
Number of
Common Shares 13,136,458 13,102,469 13,112,189 13,089,653
Weighted Average
Number of
Common and
Dilutive Shares 13,238,017 13,211,406 13,210,327 13,158,063